Local manufacturing output contracted by 4,7% year-on-year in November, the least negative growth rate recorded, to date, in 2009, Statistics South Africa (Stats SA) reported on Tuesday.

Efficient Group economist Freddie Mitchell noted that this was “all in all a good figure” with a definite slowing in the pace of the contraction in manufacturing output being evident.

The contraction in manufacturing production had slowed to a negative growth of 9,6% year-on-year in October last year, a vast improvement on the record decline of 21,6% recorded in April 2009.

The Kagiso Purchasing Managers Index, which is a key measure of manufacturing activity, had finally risen back above the neutral 50-index point level for the first time since May 2008, in November last year, recording 50,3 points.

South Africa’s overall economic recovery, as well as a recovery in the manufacturing sector, was expected to slowly improve, with Mitchell saying that this was a turning point, with many of the manufacturing indices moving sideways.

Official data showed that the November decline was mainly as a result of a 17,2% contraction in output by the wood and wood products, paper, publishing and printing division, followed by the furniture and other manufacturing division, which registered a 15,2% decline in output.

The petroleum, chemical products, rubber and plastic products division, with a 3,1% decline in output; the basic iron and steel, nonferrous metal products, metal products and machinery division, with a 2,5% production decline; and the textiles, clothing, leather and footwear division, with a 9,2% decline, had also contributed to 4,7% decline in overall output.

Meanwhile, production in November was up 0,7%, compared with manufacturing output in October.

Overall manufacturing output for the three months ended November 30, 2009, had increased by 2,9%, compared with the three months ended August 31, 2009.

Stats SA highlighted that five of the ten manufacturing divisions had shown higher production levels in the three months ended November 30, 2009, compared with the prior three months.

The motor vehicles, parts and accessories and other transport equipment division had recorded a 7,7% increase in output; the basic iron and steel, nonferrous metal products, metal products and machinery division saw a 6,5% increase; and the petroleum, chemical products, rubber and plastic products division recorded a 3,5% increase for the three months.

The food and beverages division, with a 1% rise in output, and the furniture and other manufacturing division, with a 1,5% increase, had also contributed to the improvement in overall output.

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